Domo Activos Completes €5M Capital Increase to Buy New Land

14 September 2018 – Eje Prime

Domo Activos is continuing to finance the expansion of its land portfolio. The property developer Socimi aimed at medium-sized investors has undertaken a capital increase amounting to €5 million, according to a statement filed with the Alternative Investment Market (MAB).

Domo Gestora’s Socimi, which made its debut on the stock market at the end of 2017, has subscribed 2.5 million shares, granting them a nominal value of €2 each. With these resources, the company will be able to continue paying for its land purchases on which to develop residential buildings for rent.

Domo Activos already approved a capital increase amounting to €15 million at an Extraordinary General Shareholders’ Meeting in December, though the issue and launch into circulation of up to a maximum of 7.5 million shares.

Since its creation in 2015, Domo Gestora’s property developer has been committed to acquiring buildable land in locations such as Madrid, Málaga, Valencia, Sevilla, Córdoba and Zaragoza. Currently, the largest project being promoted by Domo Activos is an 80-home development that it is building in Madrid, in the Ensanche de Vallecas.

Original story: Eje Prime

Translation: Carmel Drake

La Caixa Finalises its Purchase of 49.9% of Saba for €900M

6 June 2018 – Expansión

Criteria is planning to acquire 100% of the parking lot group, which has itself closed several operations in recent months, resulting in the addition of almost 15,000 parking spaces to its portfolio.

Reorganisation between the shareholders of Saba, the parking lot group controlled by Criteria (50.1%), the industrial holding company of la Caixa, and in which Torreal (20%), KKR (18.2%) and ProA (10.5%) hold stakes, along with 3,000 minority shareholders (1.2%).

Criteria is finalising the acquisition of the remaining 49.9% that it does not yet own in Saba for €900 million, according to sources in the infrastructure sector. It remains to be seen whether this operation will be completed in time to be approved at the Ordinary General Shareholders’ Meeting, which is scheduled to be held next Tuesday, 12 June. The celebration of the assembly had been postponed from 9 May precisely for the purpose of signing the deal that will see Criteria take complete control over the group chaired by Salvador Alemany.

The agenda for Saba’s General Shareholders’ Meeting includes the ratification and appointment of the company’s directors. In the event that the takeover does not take place, the most feasible option would be for another General Shareholders’ Meeting to be convened, but in that case an Extraordinary one.

The price at which Saba had been valued initially amounted to around €1.4 billion for 100% of the Catalan company, based on a multiplier of around 14 times its EBITDA in 2016. Saba’s accounts for 2017 have not been published yet, pending the General Shareholders’ Meeting next week, but a slight increase is expected both in turnover and profits, boosted by the strong performance of the firm in countries such as Portugal. In 2016, the company recorded a comparable gross profit of €94 million after generating revenues of €205 million, 66% of which were recorded in Spain.

Original story: Expansión (by M. Á. Patiño, A. Zañón & C. Morán)

Translation: Carmel Drake

Azora Postpones the Liquidation of its European RE Investment Fund

6 March 2018 – Expansión

Strategy / The manager is asking the shareholders of Azora Europa 1, including Sabadell, Bankia, Abanca, Manuel Jove and the President of Ebro Foods, Antonio Hernández Callejas, to extend the divestment period.

With renowned shareholders, the firm Azora Europa 1 has convened an Extraordinary General Shareholders’ Meeting on 21 March, where it is going to address a change of strategy. The company was created by the heads of Azora in 2005 with the aim of looking for real estate investment opportunities. Two years later, when the real estate bubble burst in Spain, the firm started its journey with investments from Sabadell, Bankia, Kutxabank and Abanca, the businessman Manuel Jove – President of the holding company Inveravante and founder of the real estate company Fadesa –, and the President of the listed company Ebro Foods, Antonio Hernández Callejas.

Azora Europa 1 chose Eastern Europe as its primary investment destination and rental properties as its main asset. Thus, between 2008 and 2015, Azora Europa undertook 10 real estate projects in Poland and another one in the Czech Republic. During that period, Azora’s fund closed its investor period with a total volume of €410 million, of which €140 million corresponded to own funds.

Ten years after its launch, its directors terminated the fund’s journey and requested authorisation from its shareholders to initiate the divestment process. Nevertheless, one year on, the company has taken a step back from that initial plan and is going to ask its investors to postpone its complete liquidation. The fund, which at its height accumulated a dozen properties, two for residential use and the rest for office use in Poland and the Czech Republic, has decided to divest the residential complexes and the Galerías Louvre in Prague, and exclusively hold onto its office portfolio in Poland. The reason given is the high returns offered by those assets, say sources at Azora. It is a portfolio leased almost in its entirety and which includes, amongst others, the headquarters of BNP Paribas Fortis in Krakow and the Harmony Office Centre in Warsaw, whose main tenant is Millennium Bank.

Now, the heads of Azora (the company that also manages the Socimi Hispania) are going to have to obtain approval from their shareholders, on 21 March, to extend the initial divestment period. At the meeting, the subject of a capital reduction will also be addressed, for a maximum amount of €6.16 million.

Valuation

According to the latest published accounts, Azora Europa 1’s real estate investments were worth €260.7 million as at December 2016, compared with €269.5 million a year earlier. In 2016, the fund recorded revenues of €30.6 million, of which €12.8 million proceeded from the sale of properties (compared with €1.8 million generated from the same concept a year earlier). In that year, Azora Europa 1 recorded losses of €3.73 million, primarily due to provisions recorded for the impairment of tax credits.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Domo Activos Embarks On New Growth Phase

3 November 2017 – Eje Prime

Domo Activos is embarking on a new phase of growth. The largest property developer Socimi, aimed at medium-sized investors, is going to launch a €15 million capital increase over the next few weeks. It plans to use the funds raised to buy new land in Spain, with the purpose of building new homes, according to José Luís Alba, Director of Domo Gestora’s Socimi.

According to the director, the company has already identified opportunities in Spain and is now waiting to beef up its financial strength so as to be able to actually purchase the new plots. “We will focus these acquisitions in Madrid, Málaga and Valencia in the first instance, but we are also looking for plots in Sevilla, Córdoba, Granada and Zaragoza”, said the executive.

Domo Activos Socimi will increase its share capital through an issue and placement into circulation of up to a maximum of 7.5 million shares, with a nominal value of €2 each “with an incomplete subscription forecast”. To approve this increase, Domo Activos has convened an Extraordinary General Shareholders’ Meeting, which will be held in Madrid on 30 November.

The business model of Domo Activos involves the acquisition of land for the construction of buildings, which are let out for the first three years and then sold “whereby benefitting from the tax benefits afforded to these types of companies”. “In this way, all of the capital gains generated, from the date the land is acquired to the date the properties are sold, are not taxable for corporation tax purposes”, explain sources at the group.

According to the company’s own estimates, the return on this project, once the divestments have been made, could reach 10% per annum. Investors receive the profits resulting from rental income in the form of dividends throughout the period that the buildings are leased and until they are sold.

Currently, the first project being promoted by Domo Activos is the development that it is constructing in Madrid, in El Ensanche de Vallecas. This building will contain eighty homes for rent, according to sources at the group.

New leadership team

Moreover, the company has also been reshaping its management team in recent months. To carry out this new phase of growth, Domo Gestora has appointed José Luís Alba as Director of the Socimi, a role carried out until now by Roberto Boluda, who moved to Prygesa in July as the Managing Director of the property developer owned by the Pryconsa group.

Domo Gestora’s Socimi was created by a team that is closely related to the real estate business. When it was launched, the company appointed Enrique Guerra as its CEO. Guerra is an expert in real estate management and has specialised in housing cooperatives since 2002 (…).

Domo’s management team is completed by executives such as Juan Pedro Plaza, the Socimi’s Director of Investments (…); Feliciano Conde, who took over the presidency of Domo Activos in January 2016 (…); and Alberto Freire, Director of Developments at Domo, amongst others.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Testa To Approve Its Merger With Acciona’s Rental Home Business This Week

11 September 2017 – Expansión

This week, Testa Residencial, the Socimi owned by Santander, BBVA and Merlin, is expected to approve its merger with Acciona’s rental home business, in an operation estimated to be worth €341 million. The deal will result in the constitution of the largest rental home real estate company in the country.

Testa is expected to approve the operation, which will be executed through a non-monetary capital increase, at its Extraordinary General Shareholders’ Meeting on Thursday. Acciona will incorporate its portfolio of 1,058 rental homes into Testa’s business. In exchange, it will receive shares equivalent to 21% of the Socimi’s share capital.

Original story: Expansión

Translation: Carmel Drake

Testa To Approve Receipt Of Homes Worth €665M From Its Shareholder Banks

30 January 2017 – Expansión

The Socimi Testa Residencial, which is owned by Merlin and the shareholder banks of the former Metrovacesa, is holding an Extraordinary Shareholders’ Meeting today to approve the contribution of new homes to its portfolio by Santander, BBVA and Banco Popular. The homes have a combined value of €665.5 million.

Specifically, the operation will be structured as a capital increase through non-monetary contributions, with a nominal value of €52.6 million and an overall value (nominal value plus issue premium) of €665.5 million.

The operation, which was announced on 15 September 2016 by the President of the Socimi Merlin Properties, Ismael Clemente, means that Testa Residencial – which owns the Group’s rental homes following the merger with Metrovacesa – may double in size thanks to the contribution of homes that the shareholder banks are expected to make.

At the time, Clemente revealed that Santander could end up contributing 4,000 homes and BBVA may provide 1,500 homes to Testa Residencial, which was initially created with 4,700 homes, a pro-forma gross asset value of €980 million and a net asset value of €617 million.

By contributing more homes, the banks may increase their stakes in the company, to the detriment of Merlin. Merlin currently owns 68.76% of the share capital, whilst the remaining 31.24% is held by the former shareholders of Metrovacesa.

Moreover, Testa Residencial’s Extraordinary Shareholders’ Meeting will approve an increase in the company’s share capital through monetary contributions for an overall value (nominal value plus issue premium) of €322.4 million with preferential subscription rights. (…).

Regarding the debut of the Socimi Testa Residencial on the stock market this year, the Corporate Director General of Merlin Properties, Miguel Ollero, said that it will not happen this year and that there is no rush, although the entity does have an obligation to debut on the market within two years.

Original story: Expansión

Translation: Carmel Drake

Merlin & Santander Plan To List Testa Residencial In 2017

12 September 2016 – Expansión

Mega-operation / On Thursday, the General Shareholders’ Meetings of Metrovacesa and Merlin will approve the merger from which the largest real estate company and rental home Socimi will emerge, which will debut on the stock market next year.

Merlin Properties and Santander plan to list Testa Residential on the stock market next year. The rental home Socimi will result from the merger between the real estate company and Metrovacesa, according to comments made by official company sources to Europa Press. The new Socimi will result from a mega merger operation between Merlin and Metrovacesa, the real estate company in which Santander, BBVA and Popular all own stakes.

The largest real estate company in Spain will emerge from this integration. The firm will also be one of the largest RE companies in Europe, with a portfolio of office buildings, shopping centres and logistics assets worth around €9,300 million. The new Merlin will have Santander as its majority shareholder, with a 21.9% stake, and will list on the Ibex.

New company

The operation will also give rise to a second company, Testa Residential, as a result of a decision by Merlin and Metrovacesa’s creditor banks to separate their respective batches of rental homes into an independent company.

Merlin and Metrovacesa are already finalising the integration process, which will give rise to the two companies and which will be completed at the end of October. On Thursday 15 September, the companies will hold their respective extraordinary general shareholders’ meetings, where the merger operation will be approved.

Subsequently, both companies will participate in an asset-share exchange, through which the integration will materialise. By virtue of the operation, Santander and the other banks that currently control Metrovacesa will transfer the real estate company’s office buildings and shopping centres, worth €1,672 million, to Merlin, in exchange for shares in the Socimi. In parallel, the two companies will transfer their rental homes to the new company Testa Residencial, which will have a portfolio of rental homes worth around €980 million.

Testa Residential’s debut on the stock exchange forms part of the growth strategy to be implemented by the new Socimi, which is now the largest rental home company in the country. The real estate company will receive approval for an initial portfolio containing 4,700 rental homes, mostly located in the province of Madrid (63%). The other properties are located in Mallorca, San Sebastián, Pamplona and other cities.

One of the new growth pillars of Testa Residencial will be the provision of new batches of homes by Santander and the other two shareholder banks of Metrovacesa, BBVA and Popular, through non-monetary capital increases.

Shareholders

The entity chaired by Ana Botín will be the majority shareholder of the new firm Testa Residencial, with a 46.21% stake, ahead of Merlin, which will own 34.2% of the share capital, BBVA (13%) and Banco Popular (6%). Merlin Properties plans to hold onto its stake in the rental home company over the long term, despite the dilution of its initial percentage stake, as the banks contribute new assets.

Original story: Expansión

Translation: Carmel Drake